Industry Regulations

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Industry Regulations

Last Updated Projects in Industry Regulations

17
A Shameful Sugar Policy
Despite the popularized image of the United States as a bastion of capitalism and free trade, the price of sugar and its production are determined in this country as much by bureaucrats and politicians as by consumers and producers. The end result is domestic sugar prices that are typically twice those of the world sugar market.  We have, in effect, the absurd situation in which the federal government, the country’s lead enforcer in halting anti-competitive actions, simultaneously finds itself in the position of cartel ringleader.  As much as U.S. officials, including President Donald Trump, seek to portray the United States as a free trade exemplar beset by trading partners engaged in practices that are supposedly neither fair nor reciprocal, the sugar program exposes this rhetoric as at best overwrought. How can the United States bemoan closed foreign agriculture markets when it engages in such protectionism in the same sector? According to the U.S. International Trade Commission, the removal of import restrictions would produce average annual welfare gains of $342.7 million, while economist Michael K. Wohlgenant of North Carolina State University has calculated that the artificially high cost of U.S. sugar imposes an average burden on consumers of $2.4 billion per year — a benefit to producers of $1.4 billion per year — with a resulting net cost of $1 billion.
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